Government Without Taxation

If your neighbor broke into your home and stole money to pay for his health care, he would be guilty of theft. If an employer withheld wages from an employee in order to pay for his daughter’s braces, he would be guilty of theft. Indeed, if a private citizen takes money from another individual by force for any purpose, he is guilty of theft. Neither the status nor the moral nature of an action changes simply because government is doing the taking. In a capitalist society, the initiation of force in any form—including taxation—is prohibited. In a capitalist society, government financing is obtained through voluntary means. How then, does a government in a capitalist society raise the funds that it requires for its legitimate functions? If payment for government services is voluntary, why would anyone volunteer? Don’t we need taxation to ensure that everyone pays his “fair share” to support government? After all, government is necessary to protect individual rights, and all individuals benefit from government. These are legitimate questions, and the answers may surprise you.

Taxation, by its very nature, denies an individual his property, forcing him to dispose of it contrary to his own choices for purposes chosen by others. While few would dispute this point, many believe that taxation is a “necessary evil,” for without such coercive measures, government would not receive the funding that it requires. While a completely voluntary system of paying for government has never been attempted, we can observe evidence that clearly demonstrates that individuals will voluntarily pay for government.